S Korea, EU to initial free trade deal next month
SEOUL, Sept. 10 (Xinhua) — South Korea and the European Union (EU) will initial their bilateral free trade agreement (FTA) in October as the both sides completed legal reviews of the deal this week, the Ministry of Foreign Affairs and Trade said on Thursday.
The two sides "agreed to initial the pact next month," Lee Hye-min, deputy trade minister told media, without giving further details, only saying that "the date and the venue will be decided later".
The two sides have held two rounds of legal reviews on the agreement concluded earlier July.
The deal is expected to go into effect in July next year, according to the official.
Officially launched in May 2007, negotiations for the South Korea-EU free trade deal were concluded on July 13 between South Korean President Lee Myung-bak and Swedish Prime Minister Fredrik Reinfeldt.
The deal is expected to boost bilateral trade between South Korean and EU countries as much as 20 percent, local think tank Korea Institute for International Economic Policy (KIEP) said.
Under the agreement, the two sides will eliminate or phase out tariffs on 96 percent of EU goods and 99 percent of South Korean goods within three years, and abolish tariffs on most industrial goods within five years.
On auto trade, one of the most sensitive issues, the two sides agreed to eliminate tariffs on cars with an engine displacement of over 1.5 liters within three years. Tariffs for smaller cars with an engine displacement of less than 1.5 liters would be lifted after five years.
The EU have been largest foreign investor in South Korea and its second-largest trading partner after China last year, with two-way trade reportedly reaching over 90 billion U.S. dollars.